CUTTACK: The Orissa High Court has directed the Life Insurance Corporation of India (LIC) to formalise flat allotments under its Policy Holders’ Housing Scheme (Jeevan Bima Nagar) in Chandrasekharpur, Bhubaneswar.
The single judge bench of Justice Dixit Krishna Shripad has quashed LIC’s decision to cancel the allotments and shift to an auction-based process. The case arose from four separate petitions filed by policyholders who alleged that LIC had initially promised to allot flats through a lottery system, as was done in the past, but later reneged on this commitment and moved towards public auction instead.
LIC had received land from the state government in 1992, with the lease deed executed in 2014. The housing scheme involved two phases: phase-I (192 flats) and phase-II (228 flats). Of the phase-II units, 153 were allotted and 75 remained. These 75 flats were subject to the legal dispute.
In the four petitions filed between 2015 and 2018, the petitioners claimed they were selected through a lottery in 2014, paid Rs 1,00,000 each, and awaited formal lease registration. However, due to complications under the Forest Conservation Act, 1980 - since the land was part of a reserved forest, LIC couldn’t get the updated record of rights (RoR), halting the registration process. After a prolonged wait, the RoR was eventually updated, but LIC still chose to cancel the earlier allotments, offering refunds instead.
While LIC cited soaring real estate prices and legal hurdles for the delay, the court noted that the petitioners were also not at fault and had complied with all conditions. Justice Shripad held that the petitioners must pay an additional 10 per cent over the originally agreed flat price to account for market changes, while LIC must honour the original allotments.